Netflix (NFLX) closed the latest trading day at $913.35, indicating a -0.04% change from the previous session’s end. This move was narrower than the S&P 500’s daily loss of 0.3%. Meanwhile, the Dow experienced a drop of 0.35%, and the technology-dominated Nasdaq saw a decrease of 0.25%.
The internet video service’s shares have seen an increase of 13.44% over the last month, surpassing the Consumer Discretionary sector’s gain of 5.25% and the S&P 500’s gain of 1.09%.
Analysts and investors alike will be keeping a close eye on the performance of Netflix in its upcoming earnings disclosure. The company’s upcoming EPS is projected at $4.20, signifying a 99.05% increase compared to the same quarter of the previous year. Alongside, our most recent consensus estimate is anticipating revenue of $10.15 billion, indicating a 14.95% upward movement from the same quarter last year.
NFLX’s full-year Zacks Consensus Estimates are calling for earnings of $19.78 per share and revenue of $38.91 billion. These results would represent year-over-year changes of +64.42% and +15.37%, respectively.
Investors should also pay attention to any latest changes in analyst estimates for Netflix. Recent revisions tend to reflect the latest near-term business trends. Therefore, positive revisions in estimates convey analysts’ confidence in the company’s business performance and profit potential.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. As of now, Netflix holds a Zacks Rank of #3 (Hold).
Looking at valuation, Netflix is presently trading at a Forward P/E ratio of 46.2. This indicates a premium in contrast to its industry’s Forward P/E of 9.47.
Also, we should mention that NFLX has a PEG ratio of 1.76. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company’s projected earnings growth. By the end of yesterday’s trading, the Broadcast Radio and Television industry had an average PEG ratio of 0.79.
The Broadcast Radio and Television industry is part of the Consumer Discretionary sector. This industry, currently bearing a Zacks Industry Rank of 81, finds itself in the top 33% echelons of all 250+ industries.
